The chief of the Deninu K'ue First Nation in Fort Resolution, N.W.T., is questioning Avalon Rare Metals' plans to look at building a processing facility outside the territory.

Last week, Avalon announced it's considering changing the location of its hydrometallurgy plant for the raw materials extracted from its proposed Nechalacho mine. Pine Point, N.W.T., had been a proposed location for the plant.

In a written letter, Chief Louis Balsillie said the news didn't come as a surprise, but the timing raises some questions.

Balsillie says Avalon waited until it received approval from regulatory boards before making the news public. Balsillie wonders why the company didn't include their plans in talks with the band and the territorial government before those approvals were granted.

In its feasibility study, Avalon said about 300 jobs would be created in the N.W.T. as a result of its mine. Roughly 80 of those jobs would be at the Pine Point hydrometallurgy plant.

The letter says the prospect of jobs related to the Pine Point plant helped Avalon acquire the co-operation of the Deninu K'ue.

Rare earth metals are a collection of 17 elements that are used in high-tech devices like batteries, magnets, wind turbines, cellphones, electric cars, flatscreen televisions and missile guidance systems.

There's a global rush to discover and process new rare earth mining facilities. The vast majority of the world's supply comes from China, where there are now signs of wanting to limit exports of the rare earth metals.

Avalon hopes the Nechalacho mine will be operational by 2017.

Corrections

  • A previous version of this story said 300 jobs were expected at Pine Point. The Nechalacho project is expected to employ a total of 300 people. Also, the mine is expected to be operational in 2017, not 2016.
    Aug 15, 2013 8:24 AM CT